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To: robnhood who wrote (35012)	5/24/2000 11:23:00 AM
From: Lymond	Respond to of 42523

Moral hazard is naturally a problem. It's worth keeping in mind that while the institutions may be supported in case of failure, shareholders are often forced to take extreme pain in a failure/recap scenario; and managements -- at least in the US -- own far more stock than they used to. Of course, practices differ from country to country. That all said, practical reform here is needed, and highly desirable IMO. One notion would be to make liability holders -- senior as well as subordinated -- bear more of the cost (than they presently do) in a bailout.